There are back-to-back monologues on today’s episode. The two episodes consist of the same material, just said a little different. The first take Michael was told was too aggressive with too many F bombs, so he re-recorded but still left it up on the tail end of the podcast. The double header podcast today was inspired by a film Michael recently re-watched called, “Boom Bust Boom”.

Michael talks about Hyman Minsky’s “financial instability hypothesis”. Minsky said that there is instability in capitalism and if capitalism was eliminated, that would help eliminate bubbles. Minsky believed that offsetting the economy is how you eliminate instability. This is where the government came up with zero interest rates, and in some places, negative interest rates. Due to the Minsky mentality, economists think they can control the markets and stop human nature from happening.

Michael ties his documentary film into the discussion and describes the insight he got during ’08 when he happened to be filming. Trend following strategies and behavioral economics have these characteristics in common: 1. People will never be rational. 2. Markets will always trend up, down and sideways. 3. You can’t predict trends. 4. There are ways to make money even though numbers 1-3 are set in stone and will not change.

Chris Zook is co-author of “The Founder’s Mentality: How to Overcome the Predictable Crises of Growth.” The work leading to “the founder’s mentality” started for Chris about 5 years ago. It is predicated on, “What are the deep root causes that allow some companies to stay young, stay energetic, and be sustainable in their performance over time?”

Only 1 in 10 companies sustain a modest level of growth over a decade. Chris, and his co-author James Allen, found that when the founder of a company was still evolved and their presence was still looming, companies had about three times higher performance than other companies where the founder had stepped away. Chris elaborates on their research process and the steps he and James took in writing “The Founder’s Mentality”.

A deep sense of insurgency, frontline obsession, and an owner’s mindset are the three characteristics that make up the founder’s mentality. Keeping an open mind at all times and willingness to adapt to your company’s growth is key. When companies fail to be open minded, they become short term minded. Chris has found a great response from this way of thinking. He has now written 5 books over the last 12 years on this topic and all have been extremely well received, especially his latest work, “The Founder’s Mentality”.

People are searching for happiness in their work and Chris is helping outline how to get there. He helps people own the customer service experience in their company. Chris and Michael use Nokia as a great example of an industry leader that failed to adapt. Nokia was the first to use email on phones, they were huge in cameras, and had the first smart phone but they failed to be innovative enough and became institutionally closed minded. Ultimately what looked like a tech company that could not have died, ended up committing suicide.

Chris uses Starbucks as another example of a company that started something special, but as soon as the company moved away from what Howard Schultz, the founder, had started they began to crumble. After profits started to take a hit, Howard Schultz was asked to come out of retirement and revive the company. Starbucks was self inflicting wounds that were unraveling the core of the Starbucks experience. Michael and Chris wrap up the podcast giving a few more examples of companies that caught what he calls the “founders disease” or lost the owners mindset.

“What is the goal? What does it take to get to the goal? What is the most efficient path to get to the goal? And is the goal obtainable?” Michael starts the podcast off asking these critical questions and relates them back to the explosion of social media in today’s culture. Social media is constantly being thrown in everyone’s face, and subsequently you need an efficient tool kit under your belt to be able to gain any type of real achievement in today’s world.

There is an epidemic of 20 to 30 year old men who cannot think. There is also a feminization of men that is taking over the younger generation. They seem to only be attached to their feelings. Men have traditionally had a more analytical view on things and women have a greater capacity to think with emotion. The analytical side of men is starting to get edged away.

Michael then poses the question, “How do you end the dominance of the 1%?” Michael says you either take their money, or kill them. If you do not act on one of those two things, then how else do you strip away their dominance? Once you walk through how you are going to “take care of the 1%” then you realize the statement is a sham. It just doesn’t work.

Michael moves on to poverty and unemployment next. 50% of Americans do not have $1 in the bank. 50% of Americans are also on welfare. Looking at the overall health of the American economy, things look a little messy, however the stock market is at all time highs. Although nobody can predict exactly when a black swan will hit, the economy is sure looking like it is ready for one.

Zen DeBrucke is on today’s podcast. She is the author of “Your Inner GPS: Follow your Internal Guidance to Optimal Health, Happiness and Satisfaction.” Her goal is to help clients find a stress free and happy existence by getting in touch with their inner voice.

Michael and Zen start off talking about the inner GPS. Zen believes that everyone is born with this inner voice guiding them, but most lose sight of that influence. Buddhism and Daoism have strong beliefs in the use of meditation to help people use their minds as a tool rather than an operating system. The more people realize there is a flow within their body, the more they can train their mind to get into this energy. Once someone gets into that flow, they are able to understand their thoughts and emotions clearer.

Neuroplasticity is the next. Zen says she has a tool kit to make people’s minds move in different directions. Zen teaches practices that help move their brain into a different domain when they have a block or feel trapped. She uses an example about her and her father’s relationship as well as a coaching session she had with Van Jones.

Zen describes how each person’s internal guidance system is linked in with their destiny. This internal GPS is trying to help use the mind to move towards a persons optimal life. Zen uses an example about the owner of Cliff Bar, as well as a personal example of an experience she had at the Denver airport. Her experience, in short, lead her to catching a plane ride that she would have never been able to catch had she not listened to her internal GPS. Michael also shares a personal example he had about listening to his internal GPS which lead to a great business opportunity. All these examples show the constant battle between what your gut is telling you to do, and what your head is telling you to do.

Michael and Zen wrap the podcast up discussing the meaning of ones “life purpose”. We have thousands of life purposes rather than just one. True fulfillment comes from giving and contributing. You don’t get that feeling when you are too focused on on one item. Michael says that one of his life purposes is doing the splits.

“We all avoid reality non-stop. We don’t know where it starts and where it ends. We don’t like to look at facts. We don’t like new information. We have biases that are non-stop.” Michael goes down a reality tour of market prices today. He talks about past prices in the market and the present all time highs we are experiencing right now. He makes listeners think about prices and how they move rather than voices at Bloomberg and CNBC. Michael says, “Just focus on price action and look at markets from a ‘desert island approach’.” Trading price is the only information you can trust. He gives examples from the past including the dot-com bubble, housing crisis, 1989 NIKKEI crash, Gold in the 1970’s, and possible current bubbles.

Michael emphasizes to put away all the noise and just look at the numbers. He is not saying when there will be the next market crash, just that there will be another one. Historically we are due for a significant decline. What are the odds that the S&P losses 50%? If you are going to retire soon, or are in retirement and the S&P drops, how will your life be? Will you be able to ride it out? Do you have an alternative strategy? Big questions.

Morgan Wright is an internationally recognized expert on cyber security strategy, cyber terrorism, identity theft and privacy. He brings vast knowledge and insight into the space of cyber activity.

Michael and Morgan start the podcast off talking about cyber footprints. People don’t realize that there are countless ways to steal personal identities. You don’t even need to be present anymore to become a criminal. The Chinese hacking US government databases is just one of a few examples used by Morgan to illustrate the point. Morgan says that there is no accountability in the government, which is a major contributor to why some of these hacks are able to take place.

Email is the next topic. How safe is it? Email is one of the best ways to attack someone. Companies are being hacked and having money stolen in the millions of dollars through email. Scams can come in all forms, from flat out asking for money to relationship scams. Glitches in security and technology are sometimes even known, it just comes down to if the cost to repair is worth the reward.

Michael brings the conversation back to security and asks Morgan to elaborate on healthcare.gov. Morgan was tasked with confronting Congress and explaining the lack of security within that particular government website. He went before congress to prove how ill secure the website system was. When talking about the hearings and committee for setting up the new healthcare system Morgan said, “There was nobody really in charge, there was lack of control, and oversight… It was built for failure from the very beginning.”

Michael starts the podcast off with excerpts from an interview with Clint Eastwood. Clint answers the question, “What is the pussy generation?” He also goes on to give his take on what is wrong with the US presidential election, unemployment and free education. Michael sums up the interview saying, “I do love that this 86 year old tough guy is telling us…”

Michael uses Eastwood to lay the foundation for the rest of the podcast as he talks about “Trend Following Commandments.” Michael goes in depth about some of these fundamental trend following principles.

Chase Jarvis is an award winning photographer, director, artist and entrepreneur. He is co-founder of Creative Live, a live educational platform. There is much to learn from his entrepreneurial ventures and how he made it in the photography world.

Michael and Chase start the podcast talking about basketball, and Golden State in particular. Chase goes to a lot of games and has had the opportunity to sit up close and personal with the players. He says the best part about going is seeing the infectious energy and passion among the players. Steph Curry is his favorite to watch and compares his confidence, energy, and talent to Michael Jordan.

Next, Michael asks about how Chase got involved with photography, and how his career has evolved into what it is today. Sports were a huge factor in his success as a photographer as well as becoming an entrepreneur. Teamwork, hardship, success, disappointment all gave relevance to his professional career development. His first photography shots were of skateboarding, snowboarding, etc. things that he knew well. He also had some professional friends in those sports that he could take pictures of which consequently helped jump start his career.

Chase moves into talking about his most recent venture, Creative Live. Creative Live is the world’s largest live educational platform. It is focused specifically on creative education and the ability to make a life out of that creative field. A few years ago Chase started to shift from just taking photos, to sharing his experiences with others as a photographer. He turned his photo studio into a bit of an incubator and launched the first app that could upload photo’s directly into social media outlets.

Chase shares with listeners how he flushes out his creative blocks with adventure. Adventure has always been an ignition to be propel him into a new head space. He gives a couple examples such as traveling to Europe for 6 months and traveling across New Zealand. Chase also shares simpler ways to travel and get your feet on the ground. Chase quotes a friend by saying there are two things you have to ask yourself if you think you are ready to make a change in your life: 1. Is this working? 2. Do I still believe in it? If the answer is no to both, then it is time to get out of what you are doing.

If you are interested in pursuing classes via Creative Live, Chase has provided a special discount for Trend Following listeners. Go here: https://www.creativelive.com/trend.

Michael takes the podcast back to the 1960’s with a talk from Milton Friedman. Throughout the presentation Friedman outlines the role of government in a free society. He emphasizes the different variations of “free”. The first is freedom with the absence of coercion. The second is free in the sense of a “free lunch”. They have two very different very different meanings and Friedman goes in depth on the two.

Michael wraps the podcast up summarizing Friedman’s talk with a slightly more pessimistic view. Michael thinks that politics and government will never be straightened out. He loves Friedman’s thinking but has a hard time thinking that human nature will ever change. “I have a hard time imagining, with the irrationality of human nature, that anything will ever change. As long as we keep dying and keep replenishing with a whole new group of useful idiots and sheep…we can have our fantastic view of change, but…” Michael stresses that the key thing that’s important is building capital and the only person you can count on is yourself.

Michael talks with Christopher Lochhead. Christopher is co-author of “Play Bigger: How Pirates, Dreamers, and Innovators Create and Dominate Markets”.

Michael and Christopher start the podcast talking about the commonalities between most innovators and entrepreneurs. The legendary innovators that make their companies into a success focus on three main points: product design, company design, and category design. Category design is about inventing a whole new space in the world for their product. Legendary innovators are just as thoughtful about their category design as they are of product and company design.

Christopher and his co-authors went back and looked at every start up company founded in the United States dating back to 2000. They asked, “What percentage of the market cap in the category goes to the category king or leader?” On average the category king captured 76% of the markets profits. Category design is a secret “black art” in Silicon Valley. Only about 10% of companies are thinking about teaching the world to accept their new innovation. If you do not teach your consumers, then you are leaving your company up to chance, waiting to see if people will figure your company out on their own. Christopher stresses that when you create a product that fits into an existing category, you are by definition playing someone else’s game. And you are fighting for essentially only 25% of the market. He uses Microsoft as an example.

Michael asks Christopher to go into the idea of “disrupting the marketplace” with new ideas. Christopher says that “disrupting” is actually the wrong way to go about looking at things. Elvis did not disrupt Jazz, he just created a new genre that we now know as rock and roll. And in the same way, Les Paul created the electric guitar. He did not ruin the acoustic guitar; they just sit side by side now.

“When someone comes up with a new category, how do you determine pricing?” Christopher says that the category king has pricing power. You get to decide what the pricing is if you create the category. And in order to become a category king, the CEO needs to spend at least half of his/her time articulating the problem that has been solved with their product to the customer. Christopher goes into detail and uses Pixar as an example of this concept.

The category king dynamic is not geographically bound. There tends to be different kinds of technology that breaks through in different parts of the world, but that is really the only difference. In many parts of the developing world there is even more of a focus on getting the “product, company and design” right.

Today, Michael dives into silence. An excerpt from Daniel Gross: “In the mid 20th century, epidemiologists discovered correlations between high blood pressure and chronic noise sources like highways and airports. Later research seemed to link noise to increased rates of sleep loss, heart disease, and tinnitus. (It’s this line of research that hatched the 1960s-era notion of “noise pollution,” a name that implicitly refashions transitory noises as toxic and long-lasting.)”

“Silence” science is leading the way with awesome new insights: “The growth of new cells in the brain doesn’t always have health benefits. But in this case, cells [generated from silence] seemed to become functioning neurons. “We saw that silence is really helping the new generated cells to differentiate into neurons, and integrate into the system.”

Michael weaves this narrative right back into his wheelhouse: day trading v. trend following. Lessons for traders, lessons for life. Enjoy the silence!

Emma Seppala is today’s guest. She is author of “The Happiness Track: How to Apply the Science of Happiness to Accelerate Your Success.” She is the Associate Director for the Center of Compassion at Stanford University. Emma’s work isn’t based on theories or common knowledge, there is a tremendous amount of neuroscience backing her work.

Emma starts the podcast off stating that being happy is a very subjective experience. With that in mind, in general, happiness is divided into two main categories; hedonic and eudemonic. Hedonic happiness doesn’t last long and is more associated with short burst of excitement such as sex and food. Eudemonic is much longer lasting and is more associated with self-fulfillment. Emma goes into depth explaining and giving example of both forms of happiness.

Michael asks Emma to talk about the myth of success next. Emma says Americans are over stimulating themselves, and believing that running on adrenaline is the best way to get things done. Chronic stress is actually what we are embracing and it starts to deplete our immune system. Emma acknowledges that you may not be able to control the world around you, but you can control your state of mind. Working on Stanford’s campus, Emma has seen first hand the severe epidemic of students buying into myths of happiness, especially on higher achieving campuses. They believe the only way to be successful is to burn themselves into the ground and of course, this notion is completely false. Unplugging and taking more vacations is the best way for us to reach our maximum potential. Creativity and happiness in the workplace depends on it.

Next, Emma discusses the impact breathing has on our emotions. There are different breathing practices that help out with stress and anxiety. Nurturing more calmness in our life helps us manage our energy much more. There was a study done at Harvard that showed our brains wonder 50% of the time. However, science shows that we are never happier than when we are in the moment of now. With technology constantly at our fingertips, it is getting harder and harder to be in the present moment. But when we are in the moment, it boosts our charisma and happiness. People are drawn toward others that are satisfied being in the present moment with them. Michael and Emma turn the conversation to negative emotions. These emotions make us more focused on ourselves and selfish. When the focus shifts to positivity, authenticity is created. Others crave authentic people they can connect to. They finish on talking about creativity and how to best tap into the creative parts of your brain. Just by making small changes in the way you work can really make a huge difference in the way your feel and your brain works.

Michael takes the podcast back to 1959 with an interview between Mike Wallace and Ayn Rand. Wallace and Rand focus on her ‘revolutionary’ view on the world. Rand capsulizes her views as a philosophy based on objective reality. She expands on a new code of morality centered around mans life as a standard of value. This means that a mans highest moral purpose is the achievement of his own happiness and each man must follow his own rational self interest.

Michael wraps up the podcast by summarizing the interview and comparing it to life in 2016. He talks about the importance of leaving his own impact on the world and how necessary logic and reasoning is to being successful.

Laura Roeder is a serial entrepreneur and her newest company is Edgar, a social media application. She started working for herself creating websites for people when she was 22 living in Chicago. It spread to optimizing traffic and online marketing for her clients. In 2014 she launched her social media software business, Edgar. They haven’t taken any money from investors and have grown to 2.8 million annual revenue.

Twitter, Facebook, and LinkedIn are the biggest social media platforms today. Many entrepreneurs get overwhelmed by the scope of content creation and posting needed to be successful. They tend to give up before they have even begun. Laura goes into the advantages of recycling content, notes that small percentages of your audience will ever see your content, and that the nature of the internet is all about repeated content.

The questions to ask yourself are, “How much traffic are you driving back to your website? How many people are buying off of that traffic?” There needs to be a balance between providing worthy content to your social media followers and not just pushing ads at followers. Michael then asks, “How important is it to be authentic?”

Don’t worry about people who want to un-follow or unsubscribe to your email. If they don’t want to follow you, then you don’t want them anyway. The extreme side of un-followers are critics. Laura and Michael talk about critics and how to cut them loose. They finish up talking about Edgar and how it works to make social media easier by automation, along with how Laura has carved out her space as a entrepreneurial woman in the tech space.

Michael starts off explaining how Trend Following Radio has morphed into the diverse podcast it is today. He started Trend Following Radio in 2012. It originally was all about trading, but with a Vernon Smith interview, then Gerd Gigerenzer and Dan Ariely interviews, he realized he could take it in a different direction. With those three interviews under the belt, he was able to secure Daniel Kahneman on the podcast which he believes was the real tipping point for the podcast.

For the rest of the episode Michael plays curated clips from the men mentioned above: Vernon Smith, Gerd Gigerenzer, Dan Ariely and Daniel Kahneman. He wraps up by playing a short clip from another brilliant mind in behavior finance, Nassim Taleb. The clips exemplify the spirit of behavioral finance. They range from helping people understand their behavior at a fundamental level to behavior in markets and what drives the average person to make particular risky moves in life and in their trading.

Michael finishes up talking about the enormous amount of misinformation in news and media. You need to do the reading and educate yourself. Absorb wisdom from the right people, do your homework and put in the work to get ahead. It will not just come intuitively or from “for profit” media outlets.

Michael and David Burkus start off talking about Fredrick Winslow Taylor. Fredrick’s claim to fame is discovering that it isn’t about innovating a product, but rather about innovating the factory. He looked into factory processes and what it took to make a product most effectively. The downside of his work was that he believed management should be operated scientifically as well. He thought that management was smart and factory workers were dumb. His values helped people focus on how to make a product most efficiently not how to make people sustainable, prolific and healthy. He took a lot of the emotion out of it. Most of his work has shifted from the United States and moved to other more factory driven places such as China.

The new form of work that we are seeing in most countries is creative work. Employees are required to make decisions or make collective designs with people in their company. Michael asks, “Isn’t this about making employees feel like entrepreneurs in their company or organization?” David uses tech start-ups as examples; Even as they get big they aim to make their companies continue to feel like a start-up and train their employees to think like solo entrepreneurs. This is how trust and intellect gets built within a company.

Next, Michael and David discuss the effectiveness of email. Pros: The cost of email is cheap and you can respond on your own schedule. Cons: Constant text and emails have diverted focus and created too much distraction. David stresses that there is no such thing as “multitasking”, there is only task switching. Some studies say it could take up to 15 minutes to get back to the focus you were at before you were interrupted.

Michael and David move the discussion back to the importance of keeping your employees happy. Having outstanding customer satisfaction comes down to putting employees first. Sometimes that means siding with your employees over your customers. You need to be able to tell some customers that your company or product simply may not be right for them. Also, creating the right work environment is key. Open work environments as opposed to more closed work environments have been becoming the norm. In an open office environment the idea is that working together is easy and creates a better collaborative environment. However there are negative effects such as increased sick days (perhaps because they do not want to see certain co-workers) and more distraction.

Michael and David finish talking about non-compete clauses and the counter productiveness of them. There is a difference between a non-compete and a non-disclosure. Apple and Google have two totally different views on this. Google is 100% fluid and open. Apple is very closed off and believes in the non-compete clause. When people migrate from one company to another, it has been shown in studies that both companies actually win from the intellectual knowledge transferred and gained from each other. Non-compete environments benefit everyone in the long term. Also, on a societal level you can see a huge benefit when non-competes are not allowed.

Michael starts an email from a listener that starts with praise, then turns around and claims that a top trend following trader has 400 employees and “super computers” to carry out trades, and that is why he is so successful. Michael uses this listener as just one example of how millions think. They are confused by what a computer does, and simply don’t understand what trend following is all about. The trader he refers to is on record saying that he trades off of Excel spreadsheets. For the remainder of the podcast, Michael expands on his response to the listeners email, and breaks apart algorithmic trading.

Michael next reads an excerpt from “Intuition Pumps and Other Tools for Thinking”, by Daniel Dennett. The excerpt breaks down algorithms in depth. Michael’s point is to show that a computer doesn’t make a great trader, it is the algorithms programed in the computer that creates the success. Where do the algorithms come from? Humans. Trend following is all about having the brilliance to come up with a strategy, but the execution is straightforward.

Jason Gerlach and Chris Stanton are the CEO and CIO of Sunrise Capital Partners. Sunrise Capital is a systematic firm located in San Diego. They were featured in The Little Book of Trading. Sunrise has been in business for four decades trading. Their goal is to invest in an intellectual way by taking human emotion out of their decision-making.

Michael opens the conversation up with Brexit and how Sunrise Capital reacted. There are foreseeable events and unforeseeable events. Brexit was a foreseeable event. Jason and Chris breakdown the weeks before Brexit, and how Sunrise has been positioning their portfolios in contrast to other firms. Jason and Chris say that in the systematic world there have been two different camps of thought in how to approach Brexit.

Michael moves the conversation from Brexit to Oil dropping in 2014. Jason and Chris say that these events are not just moneymaking events, they are also risk management events. People live in the middle of a bell curve and never think of the tail events in life. They trade and invest for the non-random times and are always shocked when events tend to go further than expected. Sunrise does the opposite and uses technology to curb our human irrationality.

Michael and Chris dive deeper into risk management and the importance of diversification. Sunrise has five systems that operate differently in all market situations. Chris explains risk adjusted return and how setting the “heat” is really the heart of leverage. “What kind of return is optimal for you?” The higher expected rate of return, the more drawdown you may have. When you look at someone’s rate of return, you have to look at what their drawdowns are like. Leverage is a reality in strategies; you just need to be responsible with that leverage and cater it to each individual investors needs.

Michael moves on to ask, “Has Brexit opened up Pandora’s box?” Chris and Jason say Sunrise believes that price distribution has changed since 2013. Intraday volatility has changed and prices now make huge jumps in smaller time-frames than they ever have before.

Everyone was told to trust the system and be happy: “Save your money and interest income will be your retirement.” This has come to be completely untrue and people are collectively beginning to wise up, as seen in Brexit.

Michael goes into a timeline of market crashes illustrating trend following success: 1973-1974 stocks go down 50% and trend following kills it. 1987, known as Black Market Monday, US stocks go down 20%+ in a day and trend following kills it. Barings Bank collapses spring of 1995, trend following kills it. August 1998, Long Term Capital Management craters, and trend following made a fortune. It was almost a zero sum transfer from LTCM to trend followers in August of 1998. Spring of 2000, the dot com bubble bursts and trend following cleans up again. 2002 was one of the best trend following performance years ever. After 2002 another bubble is built and when it burst in October of 2008, trend following had outstanding performance results yet again. When the majority of people think the world is ending, trend following is reaping the profits. Brexit? Yes, too.

Nobody can predict the future but if you want to play the game, you have to place bets. Trend followers were in established trends once Brexit hit. They do not predict, but they have educated bets. Michael ends with one question, “What side are you going to be on? The side of the winners or the side of the losers?” It’s your choice.

Michael and Jack Schwager talk about his new venture Fund Seeder. Jack is the author of the Market Wizard series. His books have remained relevant over the past 25 years, and for many traders they are the best trading books on the shelves today. Michael and Jack talk about the structure of the Market Wizards books and how they evolved to interview style format. Michael thanks Jack for opening his mind on the direction he took the Trend Following Radio podcast.

Many of the traders Jack was able to interview, such as Bruce Kovner and Michael Marcus, never did another interview after “Market Wizards.” A lot of the secret to the book series success was the exclusivity of the interviews. Michael asks, “Of all the traders you have talked to, what trader impressed you the most?” Jack has a hard time, of course, narrowing it down to just one because there has been so many extraordinary people that he has interviewed. That being said, in terms of track records and sheer intellect, he would chose one. Jack was completely awed by his accomplishments and was surprised how great he was on a personal level.

There has been a strong trend over the years for money to go to bigger and bigger asset managers. It has become a safer thing to do, to put money with a larger manager. It isn’t performance driven, it is purely safety driven. Jack says that even if you have skill it is becoming exceedingly more difficult to gain new clients and get big. Jack’s new venture is focused on helping these start up traders. The firm helps connect investors as well as companies that may want to find new and upcoming traders. Jack elaborates on the match making process and how they present verified and unverified track records.

Michael starts the podcast asking, “Do you need permission to get through your day?” He goes right into two examples: The first example is of his 12 year old nephew who just finished his baseball season. The second example is of a new show called “Billions.” It is about a hedge fund manager pitted against the U.S. attorney of New York.

Michael argues against/for the political corruption that starts in child sports. Michael says that being screwed over early by the system is a good thing. It makes you stronger in the long run. Every time you face these types of obstacles, you need to learn to punch through them. You can’t get bogged down with seeking permission. Especially at a young age, if children learn to push through and work hard they will have a much better chance at success later on in life.

Michael recommends watching the show, “Billions”. However, there are some things about Wall Street that have been left out. The show is based around a corrupt hedge fund manager that only trades off insider trading. The show does not highlight any other form of trading other than trading off fundamentals. Basing a character off of trend following is not nearly as “sexy” or dramatic. They want to position all of Wall Street as insider traders and corrupt because that is a far better story than making money off of rules and algorithms.

Michael takes a sci-fi journey on today’s podcast as he interviews Robin Hanson. Robin is professor of economics at George Mason University and his new book is, “The Age of EM.” Robin and Michael look forward about 100 years and analyze what the world will look like.

They start the podcast discussing singularity and what it will be like when robots take over. Michael asks, “How much time will it take to get to singularity and are there faster ways that we may get to this point?” Robin says that robots are a staple of where the future is headed. There are a few different schools of thought on how they will evolve but Robin’s theory is based on porting. In a nutshell, this means that you re-write old software to fit your new criteria. The idea is to do the same thing with the human brain. Robin goes into detail on this idea and says that it may take as little as one century to unfold.

Next, Robin discusses the types of people that will start out being emulated. The first will be top intellectuals of the time. After some years that will expand to other types of humans. Robin says that the economy will boom and double in size quickly. He also expands on “Em cities”, what they are, how they are created, and how they are run. “Em’s” is the term Robin uses for emulation robots.

Michael brings up the effects this next reality will have on mother nature and Em sex. Em’s live in a virtual reality. They never have pain or disease. They have perfect bodies and just have sex for recreational purposes. However, they do not last forever. Em’s will have to retire eventually because of software rot which Robin gives examples of and expands on.

Next, Michael asks about the political ramifications of robots entering the work space. Will Em’s run for politics? Robin says that they will most likely be involved in politics because they would never want to be run by people that are not nearly as fast and smart as them. He then expands on what the bodies of Em’s will look like. He describes the different shapes and sizes that Em’s are going to employ. This leads to the question of death. “Will Em’s be afraid of death?” Robin says that they probably wont see it coming.

Many people, when they look at the future, like to discuss what will happen. There is a degree at which our future can be influenced but to a large degree it is out of our control. Technology has been out of control for awhile. There are such varied interests among people that it will not matter if one group wants to move forward with Emulations or not. Things will continuously evolve. Michael and Robin end on how the political system will be run in the Em world.

On today’s podcast Michael breaks apart comments from a Ray Dalio article. Dalio is one of the most successful hedge fund managers alive. He does not give out too much information on his trading strategy, except that he is 100% systematic.

Before Michael begins reading the article he asks, “When the Fed raises interest rates, what will happen? Will the world end like people seem to think?” The first article he reads from was written in 2015 and answers questions on interest rates and the Fed. Next, Michael reads an article from 2016 where Ray comments on the Fed further. Ray is running a systematic firm, however, he gives historical narratives of the debt cycle. Michael still asks the question, “How do Ray’s words connect to trading? When to buy? When to sell?”

Michael stresses that presenting “Oz behind the curtain” statements do not help anyone in there trading. If someone said buy here, sell here, that would help people, but using terminology that could be interpreted as anything is worthless.

Michael interviews Tucker Max. Tucker has authored many books, however today he is on the podcast to talk about a new entrepreneurial venture. Tucker created a simple algorithmic process to writing a book. He began by asking himself: What do we have to do to position a book? How do we structure it? How do we outline it? How do we conduct an interview to get the information out of a authors head? And then how do we transcribe it? Once he had these answers, he had a company.

Today, 18 months in, he has signed about 230 authors and has put out about 50 books. With a price point of $20,000-$50,000, Tucker and his company offer the exact steps to writing a book. His company is not ghostwriting. They aren’t learning anything about your content, just getting your ideas on paper in a cohesive manner. You have to qualify in a few ways for their service: Can you pay for it? Do you have sufficient ideas for writing a book? And are you an a**hole? A**holes do not make the cut.

Michael and Tucker bring up the importance of Amazon when it comes to successful marketing. Although Google is the #1 search engine, Amazon is the search engine when looking for legitimate products or the best books to buy on any given subject. When people are looking for a book or a product with reviews, they turn to Amazon.

If you are going into any business, writing a book is the best way for you to become an information authority in that field. Tucker goes into depth describing the steps he takes client through to write their book. He also goes into detail about his clients motivations to writing a book or being held back from writing. Many people see writing a book as an extension of themselves and this holds them back. People don’t want to fail.

Today on Trend Following Radio Michael starts the podcast reading an email from a listener. This listener is a fan of the show and agrees with most of Michael’s views. However, he writes Michael asking about his opinion on a fundamental trading strategy that he employs. The listener uses a strategy that can’t be quantified and is not systematic. Michael challenges anyone listening to send their track record.

Next, Michael moves into another trading strategy he is asked about frequently, predictive technical analysis. When you hear predictive technical analysis, you know you are watching a show. It is all made up. Michael throws out the same challenge to any predictive technical analysis trader. Prove that it is a legitimate trading strategy.